Variable mortgages sink on the verge of rate hikes

This mortgage floating exchange rate At the end of 2021 it averaged 25.1% of the total.however, it fell to 22.3% in December. That’s why they fell to unknown levels, according to the latest report from the Spanish Mortgage Association (AHE). about a Progressive decline since 2016 The European Central Bank (ECB) placed the price of the currency at zero percent. A year ago, floating rate mortgages represented 62.9% of the total.

The decline in such contracts, more aggressive policy by financial institutions to direct their customers to fixed term mortgagesguaranteeing a permanent installment over the life of the loan but at a higher cost, especially where the main mortgage reference, Euribor, is negative. All this for the purpose improve your marginsHe suffered greatly from the ECB’s decision.

However, the situation has now changed dramatically. On the one handEuribor returns to positive territory, albeit very slightly: 0.013%. On the other hand, with inflation To escapeThe ECB is preparing to raise interest rates, following in the footsteps of the US Federal Reserve and the Bank of England. Vice-president Luis de Guindos announced that such a path could begin this summer.

When this is the case, future AHE reports gradual increase in variable rate mortgages. And financial institutions stink, as they are preparing and launching such contracts to be more profitable for their coffers. Policies to increase the price of references at a fixed rate and to make the variables more attractive.

Cost

A user with a 25-year term mortgage of 150,000 euros plus one point interest will pay a commission of 566 euros this year, this means 33 more per month if the contract is reviewed with April data.. According to calculations published on Wednesday by the HelpMyCash portal, that’s around 400 euros more per year in total. The business cites Bankinter’s analytics department, which predicts Euribor will close the year at 0.40% and reach 0.80% in 2023. In the second case, and following the previous example, the mortgage would have increased from 533 to 621 euros. 88 surcharges per month or 1,059 surcharges per year.

The portal focuses on the new banking policy and predicts that customers looking to buy mortgages in the short to medium term will “at least banks will have to start forgetting the cheap fixed mortgages we’ve become accustomed to in recent years.” “. Yes You can rent a fixed 1% at the end of 2021“It’s hard to hire someone below 1.7% now. If they don’t hurry up and hire him right away, they’ll likely find even higher rates in the near future.”

Source: Informacion

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